TSX drops as euro-zone jitters undermine jobs data

Fri Oct 7, 2011 5:10pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Claire Sibonney

TORONTO (Reuters) - Toronto's main stock index ended sharply lower on Friday as surprisingly strong North American jobs data was overshadowed by downgrades of Spain and Italy's credit ratings.

The index's resource-heavy materials sector dropped a hefty 3 percent, energy shares slid 2 percent, and financials were 1.1 percent lower. Among the most heavily weighted decliners, fertilizer producer Potash Corp dived 4.1 percent, oil company Canadian Natural Resources fell 4 percent, and miner Barrick Gold was down 2.3 percent.

"It's a bit of weakness after a pretty strong move in the past few days," said Don Vialoux, technical analyst at JovInvestment Management.

He said the TSX marked an important low earlier in the week, followed by a two-day rally, which could point to a seasonal recovery in equity markets starting earlier this year.

The Toronto Stock Exchange's S&P/TSX composite index ended down 191.71 points, or 1.6 percent, at 11,588.36. Nine of its 10 sectors were lower, with telecoms rising 0.1 percent. The index was down 0.3 percent on the week.

Early in the session, the index hit its highest level in nearly two weeks as data showed U.S. employers hired more workers than expected in September and job gains for the previous two months were revised higher, easing recession fears.

Canada created six times as many jobs than forecast in September, once again outshining the United States.

"It's been a pretty profitable week and somewhere along the way we're going to give back a little bit," said Fred Ketchen, director of equity trading at ScotiaMcLeod.   Continued...

<p>Bay Street signs are seen in the heart of the financial district in Toronto, August 17, 2009. REUTERS/Mark Blinch</p>